Full Press Release Details
AKSO HEALTH GROUP AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Expressed in U.S. dollars,
| As of | As of | |||||||||||
| September 30, | March 31, | |||||||||||
| Notes | 2023 | 2023 | ||||||||||
| USD | USD | |||||||||||
| ASSETS | ||||||||||||
| CURRENT ASSETS: | ||||||||||||
| Cash and cash equivalents | $ | 9,211,639 | $ | 7,924,468 | ||||||||
| Accounts receivable, net | 4 | 5,827,917 | 7,696,983 | |||||||||
| Prepayments and other assets | 5 | 613,723 | 272,129 | |||||||||
| Inventories | 6 | 1,227,339 | 1,686,449 | |||||||||
| Current assets held for sale - discontinued operation | 3 | - | 1,351,352 | |||||||||
| Loan receivable - current | 7 | - | 1,528,918 | |||||||||
| TOTAL CURRENT ASSETS | 16,880,618 | 20,460,299 | ||||||||||
| TOTAL ASSETS | $ | 16,880,618 | $ | 20,460,299 | ||||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||
| CURRENT LIABILITIES: | ||||||||||||
| Accrued expenses and other current liabilities | 9 | 1,004,151 | 938,767 | |||||||||
| Short-term loan-third parties | 10 | 350,000 | - | |||||||||
| Contract liabilities | 415,020 | 194,376 | ||||||||||
| Taxes payable | 12 | 93,822 | 96,005 | |||||||||
| Amount due to related parties | 10 | 9,686,152 | 9,686,152 | |||||||||
| Current liabilities held for sale - discontinued operation | 3 | - | 705,483 | |||||||||
| TOTAL CURRENT LIABILITIES | 11,549,145 | 11,620,783 | ||||||||||
| TOTAL LIABILITIES | 11,549,145 | 11,620,783 | ||||||||||
| COMMITMENTS AND CONTINGENCIES | ||||||||||||
| SHAREHOLDERS' EQUITY: | ||||||||||||
| Ordinary share ($ 0.0001 par value, 500,000,000 shares authorized, 69,763,933 and 69,763,933 shares issued, 68,598,050 and 68,598,050 shares outstanding as of September 30, 2023 and March 31, 2023, respectively) | 17 | 6,977 | 6,977 | |||||||||
| Additional paid-in capital | 71,021,898 | 71,021,898 | ||||||||||
| Treasury stock ( 1,165,883 shares as of September 30, 2023 and March 31, 2023, respectively) | ( 3,988,370 | ) | ( 3,988,370 | ) | ||||||||
| Accumulated deficit | ( 57,925,257 | ) | ( 54,467,600 | ) | ||||||||
| Accumulated other comprehensive loss | ( 3,891,840 | ) | ( 3,847,601 | ) | ||||||||
| TOTAL SHAREHOLDERS' EQUITY | 5,223,408 | 8,725,304 | ||||||||||
| Non-controlling interest | 2 | 108,065 | 114,212 | |||||||||
| TOTAL EQUITY | 5,331,473 | 8,839,516 | ||||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 16,880,618 | $ | 20,460,299 |
See notes to the unaudited
condensed consolidated financial statements
AKSO HEALTH GROUP AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF OPERATIONS AND COMPREHENSIVE (LOSS)
(Expressed in U.S. dollars,
| For the Six Months Ended September 30, | ||||||||
| 2023 | 2022 | |||||||
| USD | USD | |||||||
| REVENUES | ||||||||
| Sale of medical devices | $ | 894,768 | $ | 11,858,313 | ||||
| Tax and surcharges | ( 1,185 | ) | ( 1,231 | ) | ||||
| Net Revenues | 893,583 | 11,857,082 | ||||||
| Cost of goods sold | 854,753 | 10,731,201 | ||||||
| Gross Profit | 38,830 | 1,125,881 | ||||||
| OPERATING EXPENSE | ||||||||
| Sales and marketing | - | 100,255 | ||||||
| General and administrative | 2,354,678 | 1,245,786 | ||||||
| Total Operating Expenses | 2,354,678 | 1,346,041 | ||||||
| LOSS FROM CONTINUING OPERATIONS | ( 2,315,848 | ) | ( 220,160 | ) | ||||
| OTHER INCOME (EXPENSE) | ||||||||
| Other income | 9,508 | 384,148 | ||||||
| Other expense | ( 85,759 | ) | ( 233,345 | ) | ||||
| Exchange (loss) gain | ( 646,569 | ) | 1,727,968 | |||||
| Total Other (Expense) Income, net | ( 722,820 | ) | 1,878,771 | |||||
| (LOSS) INCOME FROM CONTINUING OPERATION BEFORE INCOME TAXES | ( 3,038,668 | ) | 1,658,611 | |||||
| PROVISION FOR INCOME TAXES | 24,869 | 11,746 | ||||||
| NET (LOSS) INCOME FROM CONTINUING OPERATION | ( 3,063,537 | ) | 1,646,865 | |||||
| Net loss from discontinued operations, net of income taxes | ( 3,905 | ) | ( 820,429 | ) | ||||
| Loss from disposal of discontinued operations, net of income taxes | ( 389,576 | ) | - | |||||
| Total loss from discontinued operations | ( 393,481 | ) | ( 820,429 | ) | ||||
| NET (LOSS) INCOME | ( 3,457,018 | ) | 826,436 | |||||
| Less: net income attributable to non-controlling interest | 639 | 16,098 | ||||||
| NET (LOSS) INCOME ATTRIBUTABLE TO AKSO'S SHAREHOLDERS | ( 3,457,657 | ) | 810,338 | |||||
| NET (LOSS) INCOME | ( 3,457,018 | ) | 826,436 | |||||
| OTHER COMPREHENSIVE (LOSS) INCOME | ||||||||
| Foreign currency translation adjustment | ( 51,025 | ) | ( 3,181,964 | ) | ||||
| COMPREHENSIVE (LOSS) | ( 3,508,043 | ) | ( 2,355,528 | ) | ||||
| Less: comprehensive (loss) income attributable to non-controlling interest | ( 6,147 | ) | 15,233 | |||||
| COMPREHENSIVE LOSS ATTRIBUTABLE TO AKSO'S SHAREHOLDERS | $ | ( 3,501,896 | ) | $ | ( 2,370,761 | ) | ||
| Net income (loss) per share | ||||||||
| Basic | $ | ( 0.05 | ) | $ | 0.01 | |||
| Diluted | $ | ( 0.05 | ) | $ | 0.01 | |||
| Weighted average shares | ||||||||
| Basic | 68,598,050 | 68,598,050 | ||||||
| Diluted | 68,598,050 | 68,598,050 |
See notes to the unaudited
condensed consolidated financial statements
AKSO HEALTH GROUP AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
OF CHANGES IN SHAREHOLDERS' EQUITY (DEFICIT)
(Expressed in U.S. dollars,
| Accumulated | ||||||||||||||||||||||||||||||||||||
| Other | ||||||||||||||||||||||||||||||||||||
| Ordinary Shares | Additional | Treasury stock | Retained | Comprehensive | Non- | |||||||||||||||||||||||||||||||
| Number of | Paid-in | Number of | Earnings | income(loss) | controlling | |||||||||||||||||||||||||||||||
| Shares | Amount | Capital | Shares | Amount | (Deficit) | (Loss) | interest | Total | ||||||||||||||||||||||||||||
| USD | USD | USD | USD | USD | USD | USD | ||||||||||||||||||||||||||||||
| April 1, 2022 | 69,763,933 | $ | 6,977 | $ | 71,021,898 | ( 1,165,883 | ) | $ | ( 3,988,370 | ) | $ | ( 53,107,676 | $ | ( 1,649,223 | ) | $ | 1,976 | $ | 12,285,582 | |||||||||||||||||
| Net income for the period | - | - | - | - | - | 810,338 | - | 16,098 | 826,436 | |||||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | - | - | - | ( 3,181,099 | ) | ( 865 | ) | ( 3,181,964 | ) | ||||||||||||||||||||||||
| September 30, 2022 | 69,763,933 | $ | 6,977 | $ | 71,021,898 | ( 1,165,883 | ) | $ | ( 3,988,370 | ) | $ | ( 52,297,338 | ) | $ | ( 4,830,322 | ) | $ | 17,209 | $ | 9,930,054 | ||||||||||||||||
| April 1, 2023 | 69,763,933 | $ | 6,977 | $ | 71,021,898 | ( 1,165,883 | ) | $ | ( 3,988,370 | ) | $ | ( 54,467,600 | ) | $ | ( 3,847,601 | ) | $ | 114,212 | $ | 8,839,516 | ||||||||||||||||
| Net (loss) income for the period | - | - | - | - | - | ( 3,457,657 | ) | - | 639 | ( 3,457,018 | ) | |||||||||||||||||||||||||
| Foreign currency translation adjustment | - | - | - | - | - | - | ( 44,239 | ) | ( 6,786 | ) | ( 51,025 | ) | ||||||||||||||||||||||||
| September 30, 2023 | 69,763,933 | $ | 6,977 | $ | 71,021,898 | ( 1,165,883 | ) | $ | ( 3,988,370 | ) | $ | ( 57,925,257 | ) | $ | ( 3,891,840 | ) | $ | 108,065 | $ | 5,331,473 |
See notes to the unaudited
condensed consolidated financial statements
AKSO HEALTH GROUP AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS
(Expressed in U.S. dollars,
| For the Six Months Ended September 30, | ||||||||
| 2023 | 2022 | |||||||
| USD | USD | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | ||||||||
| Net income (loss) from continuing operation | $ | ( 3,063,537 | ) | $ | 1,646,865 | |||
| Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities: | ||||||||
| Loss from disposal of discontinued operations | 389,576 | - | ||||||
| Provision for doubtful accounts | 1,541,880 | - | ||||||
| Accounts receivable | 327,186 | ( 7,914,232 | ) | |||||
| Prepayments and other assets | ( 341,594 | ) | ( 205,374 | ) | ||||
| Inventories | 459,110 | 6,896,267 | ||||||
| Accrued expenses and other current liabilities | 65,384 | 212,732 | ||||||
| Contract liabilities | 220,644 | - | ||||||
| Taxes payable | ( 2,183 | ) | ( 95,754 | ) | ||||
| )Net cash (used in) provided by continuing operations | ( 403,534 | ) | 540,504 | |||||
| Net cash provided by (used in) discontinued operations | 645,869 | ( 1,874,620 | ) | |||||
| NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 242,335 | ( 1,334,116 | ) | |||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | ||||||||
| Cash received from loan repayments | 1,528,918 | 20,000,000 | ||||||
| Net cash provided by continuing operations | 1,528,918 | 20,000,000 | ||||||
| Net cash provided by discontinued operations | - | - | ||||||
| NET CASH PROVIDED BY INVESTING ACTIVITIES | 1,528,918 | 20,000,000 | ||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | ||||||||
| Repayments of loans due to related parties | - | ( 27,513,849 | ) | |||||
| Loan from third parties | 350,000 | - | ||||||
| Net cash provided by (used in) continuing operations | 350,000 | ( 27,513,849 | ) | |||||
| Net cash provided by (used in) discontinued operations | - | - | ||||||
| NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES | 350,000 | ( 27,513,849 | ) | |||||
| EFFECT OF EXCHANGE RATE CHANGE ON CASH | 185,605 | ( 3,086,796 | ) | |||||
| NET INCREASE(DECREASE) IN CASH | 2,306,858 | ( 11,934,761 | ) | |||||
| CASH AND CASH EQUIVALENTS - beginning of period | 7,924,468 | 21,925,322 | ||||||
| CASH AND CASH EQUIVALENTS - end of period | $ | 10,231,326 | $ | 9,990,561 | ||||
| Less: cash and cash equivalents of discontinued operations at end of period | 1,019,687 | 1,387,425 | ||||||
| Cash and cash equivalents of continuing operations, at end of period | 9,211,639 | 8,603,136 |
See notes to the unaudited
condensed consolidated financial statements
AKSO HEALTH GROUP AND SUBSIDIARIES
NOTES TO THE UNAUDITED CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
Note 1 - BUSINESS DESCRIPTION
Organization and description of business
Akso Health Group, formerly
known as Xiaobai Maimai Inc., is a limited company incorporated under the laws of the Cayman Islands on April 25, 2016. Akso Health Group
("Akso Health"), its subsidiaries, and consolidated variable interest entities ("VIEs") (collectively the "Company"),
previously operated an online Peer to Peer ("P2P") marketplace business and micro-lending business in the People's Republic
of China (the "PRC"). Since May 2019, the Company has ceased to issue new loans through its micro-lending business and since
October 2019, the Company has ceased to conduct its P2P business. On December 30, 2020, the Company completed the disposition transaction
of its P2P business.
In May 2020, the Company
launched its social e-commerce platform to offer high-quality and affordable branded products through collaboration with online and offline
merchants. In addition, the Company is in the process of developing a new business as a cancer therapy and radiotherapy oncology service
provider with operations in the U.S. The Company plans to open 2 vaccine research centers and 100 radiation oncology centers to be located
on the east coast serving cancer patients in need of varying stages of treatment, including specialized radiation therapy centers for
radiotherapy (RT), personalized consultation, conventional treatment planning, and other cancer related treatment services. On December
3, 2021, the shareholders approved the Company's plan to change its name to "Akso Health Group". In January 2022, three
centers were established in US and the Company started its business of sales of medical devices in US market. In April 2022, the Company
started its sales of medical devices in China market through its subsidiary Qingdao Akso Health Management Co., Ltd. In May 2023, the
Company disposed its social E-commerce business and would focus on healthcare business in the future.
As of September 30, 2023,
the Company's principal subsidiaries are as follows:
| Date of | ||||||||
| incorporation / | Place of | Percentage of | ||||||
| acquisition | incorporation | legal ownership | Principal activities | |||||
| Wholly owned subsidiaries | ||||||||
| We Health Limited ("We Health") | July 8, 2021 | New York | 100 % | Investment holding | ||||
| We Healthy Limited ("We Healthy") | December 15, 2021 | Hong Kong | 51 % | Investment holding | ||||
| Akso Remote Medical Consultation Center Inc. ("Akso Remote Medical") | January 3, 2022 | Wyoming | 100 % | Provision of health treatment services | ||||
| Akso Online MediTech Co., Ltd.("Akso Online MediTech") | January 4, 2022 | Wyoming | 100 % | Sales of medical devices | ||||
| Akso First Health Treatment Center Inc. ("Akso First Health") | January 4, 2022 | Massachusetts | 100 % | Provision of health treatment services | ||||
| Qindao Akso Health Management Co., Limited ("Qingdao Akso") | January 26, 2022 | PRC | 51 % | Provision of health treatment services |
Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The accompanying unaudited
interim condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally
accepted in the United States of America ("U.S. GAAP") and applicable rules and regulations of the Securities and Exchange
Commission ("SEC"), regarding financial reporting, and include all normal and recurring adjustments that management of the
Company considers necessary for a fair presentation of its financial position and operating results. The results of operations for the
six months ended September 30, 2023 are not necessarily indicative of results to be expected for any other interim period or for the full year
of 2023. Certain prior year balances in the consolidated statements of operations and comprehensive (loss) and cash flows have been reclassified
to the current year's presentation.
All consolidated financial
statements and notes to the consolidated financial statements are presented in United States dollars ("US Dollar" or "US$"
Basis of consolidation
unaudited condensed consolidated financial statements include the financial statements of the Company, its subsidiaries, its
consolidated VIEs and VIE's subsidiaries for which the Company is the primary beneficiary. All inter-company transactions and
balances have been eliminated upon consolidation.
Due to the disposal of the
social E-commerce business, which represented a strategic shift and had a major effect on the Company's results of operations, revenues,
costs and expenses related to the social E-commerce business have been reclassified in the accompanying consolidated financial statements
as discontinued operations for all the periods presented. Assets and liabilities of the social E-commerce business were reclassified separately
from other assets and liabilities of the Company on the consolidated balance sheets. Refer to Note 1 and Note 3.
In order to comply with the
PRC laws and regulations which prohibit or restrict foreign investments into companies involved in restricted businesses, the Company
operates its marketplace and restricted businesses in the PRC through certain PRC domestic companies, whose equity interests are held
by certain management members of the Company or onshore nominees of the Company ("Nominee Shareholders"). The Company obtained
control over these PRC domestic companies by entering into a series of contractual arrangements with these PRC domestic companies and
their respective Nominee Shareholders. These contractual agreements cannot be unilaterally terminated by the Nominee Shareholders or the
PRC domestic companies. As a result, the Company maintains the ability to control these PRC domestic companies and is entitled to substantially
all of the economic benefits from these PRC domestic companies. Management concluded that these PRC domestic companies are VIEs of the
Company, of which the Company is the ultimate primary beneficiary. As such, the Company consolidated financial results of these PRC domestic
companies and their subsidiaries in the Group's consolidated financial statements. The principal terms of the agreements entered
into amongst the VIEs, their respective shareholders and the WFOE are further described below.
Exclusive Business Cooperation
The Exclusive Business Cooperation
Agreements enable the WOFE to receive substantially all of the assets and business of the VIEs in the PRC. Under these Agreements, the
WOFE has the exclusive right to provide the VIEs with comprehensive technical support, consulting services and other services during the
term of these Agreements, including but not limited to software licensing; development, maintenance and update of software, network systems,
hardware and database; technical support and training for employees; consultancy on technology and market information; business management
consultation; marketing and promotion services, etc. The WOFE has the right to determine the fees associated with the services it provides
based on the technical difficulty and complexity of the services, the actual labor costs it incurs for providing the services and some
other factors during the relevant period. This Agreements remain effective unless otherwise terminated in writing by WOFE.
Equity Interest Pledge Agreements
Pursuant to the Equity Interest
Pledge Agreements, each Shareholder of the VIEs agreed to pledge their equity interest in the VIEs to the WOFE to secure the performance
of the VIEs' obligations under the Exclusive Business Cooperation Agreements and any such agreements to be entered into in the future.
Shareholders of the VIEs agreed not to transfer, sell, pledge, dispose of or otherwise create any encumbrance on their equity interests
in the VIEs without the prior written consent of the WOFE. The Pledges became effective on such date when the pledge of the Equity Interest
contemplated herein were registered with the relevant administration for industry and commerce (the "AIC") and remain effective
until all contract obligations have been fully performed and all secured indebtedness has been fully paid.